If you don’t have an estate plan and you decide to write a will, that is a good step to take. It does help to protect your family and your assets.
But it is just the first step. It is typically not nearly enough to consider being done with your estate planning. It’s just not complex enough to do everything it needs to do. Let’s look at some of the problems with only having a simple will.
It doesn’t give you very much control
First off, a will allows you to decide who gets your assets, but it doesn’t really give you a lot of control over those assets. For instance, you could leave $50,000 to an heir and hope that they pay for college, but they might just buy a sportscar, total it, and have nothing left. Something like a trust will allow you to dictate how the money is used so that you have more control.
It doesn’t address issues outside of assets
A will may make it possible to leave specific possessions or financial accounts to people, but what about other issues that you need to consider? For instance, who is going to make your medical decisions if you can’t? Who is going to take care of all of your financial decisions? For both of these areas, you typically need to use a power of attorney and pick an agent. But a will doesn’t do that.
It may improperly address certain accounts
In some cases, a will just doesn’t have the legal power to do what you want it to do. For example, the life insurance beneficiary that you choose on your paperwork is going to get your life insurance payout, since that beneficiary overrides the will. If your will says that multiple people need to split up that payment, but only one is named as the beneficiary, that person is the only one who will actually get anything. Your intentions in the will may be clear, but it’s just the wrong document to use to accomplish this goal.
Setting up a complete plan
The key is to consider everything that you want to be in your plan and then to look into your options. There are different documents and tools that you can use, and it’s imperative that you have more than a simple will.
